Overdrive is a term used to describe a mechanism that allows an automobile to cruise at sustained speed with reduced engine speed, leading to better fuel consumption, lower noise and lower wear. Use of the term is confused, as it is applied to several different, but related, meanings.

The most fundamental meaning is that of an overall gear ratio between engine and wheels, such that the car is now over-geared and can no longer reach its potential top speed, i.e. the car could travel faster if it were in a lower gear, with the engine turning more quickly. The purpose of such a gear may not be immediately obvious. The power produced by an engine increases with the engine's speed to a maximum, then falls away. The point of maximum power is somewhat slower than the absolute maximum speed to which the engine is limited, the "redline" speed. A car's speed is limited by the power available to drive it against air resistanceso the maximum possible speed is obtained at the engine's point of maximum power, or power peak, and the gear ratio necessary to achieve this will be the single ratio between these two speeds.

As the power needed increases dramatically at high speeds, most cars will be capable of achieving a fast cruising speed slightly less than their maximum, but with far less power being required. This power is available well below the engine's power peak and so the ideal cruising gear is an overdrive gear, a ratio higher than that for absolute top speed.

With the early development of cars and the almost universal rear-wheel drive layout, the final drive (i.e. rear axle) ratio for fast cars was chosen to give the ratio for maximum speed. The gearbox was designed so that, for efficiency, the fastest ratio would be a 'direct-drive' or 'straight-through' 1:1 ratio, avoiding frictional losses in the gears. Achieving an overdriven ratio for cruising thus required a gearbox ratio even higher than this, i.e. the gearbox output shaft rotating faster than the original engine speed. The propeller shaft linking gearbox and rear axle is thus overdriven, and a transmission capable of doing this became termed an "overdrive" transmission.

The device for achieving an overdrive transmission was usually a small separate gearbox, attached to the rear of the main gearbox and controlled by its own shift lever.These were often an optional extra on some models of the same car.As popular cars became faster relative to legal limits and fuel costs became more important, particularly after the 1973 oil crisis, the use of 5-speed gearboxes became more common in mass-market cars. These had a direct fourth speed with an overdrive top gear, replacing the need for the separate overdrive gearbox.

With the popularity of front wheel drive cars, the separate gearbox and final drive have merged into a single transaxle. There is no longer a propeller shaft and so one meaning of "overdrive" can no longer be applied. However the fundamental meaning, that of an overall ratio higher than the ratio for maximum speed, still applies. Although the deliberate labelling of an overdrive is now rare, the underlying feature is now found across all cars.

Overdrive is a term used to describe a mechanism that allows an automobile to cruise at sustained speed with reduced engine speed, leading to better fuel consumption, lower noise and lower wear. Use of the term is confused, as it is applied to several different, but related, meanings.

The most fundamental meaning is that of an overall gear ratio between engine and wheels, such that the car is now over-geared and can no longer reach its potential top speed, i.e. the car could travel faster if it were in a lower gear, with the engine turning more quickly. The purpose of such a gear may not be immediately obvious. The power produced by an engine increases with the engine's speed to a maximum, then falls away. .

Overdrive (OD) is a term used to describe a mechanism that allows an automobile to cruise at sustained speed with reduced engine RPM, leading to better fuel economy, lower noise and lower wear.[SUP][1][/SUP] Use of the term is confused, as it is applied to several different, but related, meanings.[SUP][1][/SUP] The most fundamental meaning is that of an overall gear ratio between engine and wheels, such that the car is now over-geared and can no longer reach its potential top speed, i.e. the car could travel faster if it were in a lower gear, with the engine turning more quickly. In some cases this implies a second definition is also true, that the gearbox output driveshaft is rotating faster than the original engine RPM. This later definition was common in the past, but many cars no longer have a driveshaft and it is not technically correct.[SUP][1][/SUP]
In the era of front-engine, rear-wheel drive layouts, the device for achieving an overdrive transmission was usually a small separate gearbox, attached to the rear of the main gearbox and controlled by its own shift lever or electrical actuation button. These were often an optional extra on some models of the same car. As popular cars became faster relative to legal limits and fuel costs became more important, particularly after the 1973 oil crisis, the use of 5-speed gearboxes became more common in mass-market cars, with the 5th gear being an overdrive, eliminating the need for a separate gearbox.[SUP][1][/SUP]
With the popularity of front wheel drive cars, the separate gearbox and final drive have merged into a single transaxle. However the fundamental meaning, that of an overall ratio higher than the ratio for maximum speed, still applies.[SUP][1][/SUP] Although the deliberate labelling of an overdrive is now rare, the underlying feature is now found across all cars.